TMI Blog1955 (3) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... by it was agreed that the two partners would transfer and Messrs Raw Cotton Company, Limited, (hereinafter called the respondent company) would accept the transfer of, inter alia, all book and other debts due to them in connection with their business in Bombay and full benefit of all securities for the debts and all other property to which they were entitled in connection with the said business. The respondent company did not take steps under 0. XXII, r. 10 of the Code of Civil Procedure to get themselves substituted as plaintiffs in the place and stead of Habib Sons, the plaintiffs on record, but allowed the suit to be continued in the name of the original plaintiffs. Evidently, the two partners migrated from India to Pakistan and their properties vested in the Custodian of Evacuee Property. On the 15th December 1949 a decree was passed in the summary suit for the sum of ₹ 8,018-7-0 for the debt and interest and the sum of ₹ 410 for costs of the suit, aggregating to ₹ 8,428-7-0, and for further interest at 4 per cent. per annum from the date of the decree until payment. Habib Sons being the plaintiffs on record the decree was passed in their favour. On the 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... execution of the document was not challenged and nothing further need be said about that. The only substan- tial question raised wag whether the respondent company were the transferees of the decree within the meaning of Order XXI, rule 16. The learned Judge answered the question in the affirmative on the authority of the decisions of the Bombay High Court in Purmananddas Jivandas v. Vallabdas Wallji(1) and in Chimanlal Hargovinddas v. Ghulamnabi(2) and affirming the order of the executing Court dismissed the appeal. The judgment-debtor preferred a Letters Patent Appeal before the High Court which was dismissed by Chagla, C.J., and Shah, J., following the two earlier decisions mentioned above. They, however, granted, under article 133 (1) (c) of the Constitution, a certificate of fitness for appeal to this Court. The principal question urged before us is as to whether the respondent company can claim to be the transferees of the decree within the meaning of Order XXI, rule 16 of the Code of Civil Procedure. Order XXI, rule 16 of the Code of Civil Procedure, omitting the local amendments which are not material for our present purpose, provides:- 16. Where a decree or, if a de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to say that there had been no transfer of the decree to the respondent company by any assignment in writing executed after the decree was passed, as contemplated and required by Order XXI, rule 16. Indeed, Dixit, J., conceded- If the language of Order XXI, rule 16 is strictly construed, it seems to me that the Respondents have no case . And so did chagla , C,J.; when he said; ........ and it is perfectly clear that if one were to construe rule 16 strictly there is no assignment of the decree in favour of the first respondent . The learned Chief Justice, like Dixit, J., however, departed from the rule of strict or literal construction as they felt pressed by the fact that the Bombay High Court had consistently taken the view that there might be an equitable assignment of a decree which would constitute the assignee an assignee for the purpose of rule 16 and that what the Court must consider is not merely a legal assignment but also an assignment which operates in equity. The equitable principle relied upon by the Bombay High Court is what had been enunciated by Lord Westbury in Holroyd v. Marshall(1) in the following words: (1) [1862] 10 H.L.C. 191, 210, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an agreement to transfer the decree to be passed in future. As soon as the decree is passed equity fastens upon it and, by treating as done what ought to be done, that is by assuming that the transferor has executed a deed transferring the decree to the transferee as in all conscience he should do equity regards the transferee as the beneficial owner of the after-acquired decree. The equitable principle we are considering only implements or effectuates the agreement of the parties. This equity does not, however, take upon itself the task of making any new agreement for the parties either by filling up the lacunas or gap in their agreement or otherwise. If, therefore, there is no agreement between the parties to transfer the future decree the equitable principle referred to above can- not come into play at all. In order, therefore, to test the propriety of the application of this equitable principle to the facts of the present case we have to enquire whether there was here any agreement between the parties to transfer the decree to be passed in the then pending suit. This necessarily leads us to scrutinize the terms of the document in question and ascertain its true meaning and impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluding the right to prosecute the pending suit and to obtain a decree the decree that was eventually passed automatically and immediately upon its. passing must be taken as having been transferred by this very document.This argument appears to me to really amount to a begging of the question, The transfer of the debt passed all the interest which the transferors were then capable of passing in the debt and in the legal incidents thereof. There was then no decree in existence and, therefore, the transferors could not then pass any interest in the non-existing decree. Therefore, section 8 of the Transfer of Property Act does not assist the respondent company. Upon the assignment of the debt the respondent company undoubtedly became entitled to get themselves substituted under Order XXII, rule 10 as plaintiffs in the pending suit but they did not choose to do, so and allowed the transferors to continue the suit and a decree to be passed in their favour. The true position, therefore, is that at the date of the transfer of the debt to the respondent company the transferors could not transfer the decree, because the decree did not exist. On a true construction of the document the transf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on as the decree was passed the respondent company became the transferees of the decree by assignment in writing within the meaning of Order XXI, rule 16. As considerable legal learning has been brought to bear on the question of the application of the equitable principle and its effect on the prior written agreement and as the different decisions of the High Courts are not easily reconcilable, I consider it right to record my views on that question. I shall., then, assume, for the purposes of this part of the argument, that the document of the 7th February 1949 was a completed deed of transfer covering the decree to be passed in future in the then pending suit. Under the Transfer of Property Act there can be no transfer of property which is not in existence at the date of the transfer. Therefore, the purported transfer of the decree that might be passed in future could only operate as a contract to transfer the decree to be performed in future, i.e., after the passing of the decree. The question then arises: What is the effect of the operation of the equitable principle on the decree as and when it is passed? Where there is a contract for the transfer of property which is not i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the name of the executors. On the 23rd January 1873 a decree was passed for the plaintiffs on the record, i.e. the executors, for ₹ 31, 272-13-5 which was made a first charge on the Wadi properties. The appellant thereupon applied for execution of the decree under section 232 of the Code of 1882 (corresponding to our Order XXI, rule 16), as transferee of the decree. The Chamber Judge dismissed the application. On appeal Sargent, C. J., and Bayley, J., held that the appellant was competent to maintain the application. After pointing out that the ssignment was in the most general terms, Sargent, C. J., observed:- ........................ and the effect of this assignment was, in equity, to vest in Purmananddas the whole interest in the decree which was afterwards obtained. But it has been suggested that Purmananddas is not a transferee of the decree under section 232 of the Civil Procedure Code, because the decree has not been transferred to him by assignment in writing or by operation of law , and that, therefore, he is not entitled to apply for execution. There is no doubt that in a Court of equity, in England the decree would be regarded as assigned to Purmananddas, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (which was called a decree) to C by a registered deed. C did not apply for substitution of his name on the record of the suit. The Court passed a decree upon the award on the 1st September, 1939. On the 24th November 1939 C applied for execution of the decree. It was held that C was entitled to execute the decree under Order XXI, rule 16, for what had been transferred to him was not merely A's half share in the property but all his rights under the award including the right to take a decree. In this case, having regard to the terms of the previous agreement and the fact that the parties were treating the award as a decree the intention was quite clear that by the subsequent deed of sale both the award and the decree upon it had been transferred. It was quite clearly recognised by the Full Bench that if the sale deed transferred only. A's half share in the property or only his right to take a decree C could not apply under Order XXI, rule 16. Reading the three cases relied on by learned counsel for the respondent company it seems to me that they proceeded on the footing that the equitable title related back to the earlier agreement in writing and converted the agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sferee. That being the true position, as I think it is, the after acquired property cannot, logically and on principle, be said to have been transferred to the intending transferee by the agreement in writing. I do not see on what principle this transfer can be said to relate back to the previous agreement. I am fortified in my view by the observations of Lord Cave in the case of Performing Right Society v. London Theatre of Varie- ties(1). In that case, in 1916 a firm of music publishers, being members of the plaintiff society, assigned by an indenture of assignment to the society the performing right of every song, the right of performance of which they then possessed or should thereafter acquire, to be held by the society for the period of the assignor's membership. Subsequently, a certain song was written, and the copyright in it, together with the right of performance, was assigned by the author to the said firm, but there was no fresh assignment in writing by the firm to the plaintiff society such as was required by section 5(2) of the Copyright Act, 1911. The defendants, who were music hall proprietors, permitted this song to be publicly sung in their music hall without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it proceeded in the name of the original plaintiff and a decree was passed in his favour. The assignee then applied for execution of that decree claiming to be a transferee decree-holder under section 232 of the 1882 Code. That application was dismissed. White,C.J., observed:- We are asked to hold that in the event which happened in this case the appellant is entitled to be treated as the transferee of a decree from a decree holder for the purposes of section 332, notwithstanding that at the time of the assignment. there was no decree and no decree-holder. It seems to us that we should not be warranted in applying the doctrine of equity on which the appellant relies, which is stated in Palaniappa v. Lakshmanan, I.L.R. 16 Mad. 429, for the purpose of construing section 232 of the Code. We think the words decree-holder must be construed as meaning decree-holder in fact and not as including a party who in equity may afterwards become entitled to the rights of the actual decree-holder, and that the words of the section relating to a transfer of a decree cannot be construed so as to apply to a case where there was no decree in existence at the time of the agreement . It is true ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the property and the term decree holder could not cover a party who, in equity, might afterwards have become entitled to the rights of the actual decree holder. The case of Ananda Mohon Roy v. Promotha Nath Ganguli (supra) was explained as being based really on the construction that was put upon the conveyance, namely, that it covered a decree which had been passed simultaneously with, if not before, the execution of the conveyance . After pointing out that in Purmananddas Jivandas v. Vallabdas Wallji (supra) the transferor and transferee stood in the position of trustee and cestui que trust and that that circumstance might have attracted the application of the equitable principle the Court could not assent to the broad proposition supposed to have been laid down in that case that the transferee in equity became a transferee of the decree by the prior agreement so as to come under Order XXI, rule 16 and preferred to follow the decision of the Madras High Court in Basroovittil Bhandari v. Ramchandra Kamthi (supra) and the other decisions to which reference has been already made. In Pandu Joti Kadam v. Savla Piraji Kate(1) one Tuljaram obtained a decree on a mortgage again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansferred the decree that bad already been passed. In Prabashinee Debi v. Rasiklal Banerji(3), Rankin, C.J., considered the previous cases and preferred to follow the case of Mathurapore Zamindary Co. Ltd. v. Bhasaram Mandal (supra). The case of Purna Chandra Bhowmik v. Barna Kumari Debi(1) does not, when properly understood, afford any support to the contention of the respondent company. There the defendant No. 1 had executed a mortgage bond in favour of the plaintiff assigning by way of security the decree that would be passed in a pending suit which he, the defendant No. I had instituted against a third party for recovery of money due on unpaid bills for work done. After this mortgage a decree was passed in that suit in favour of the defendant No. 1 who bad continued that suit as the plaintiff. The plaintiff claiming to be the assignee by way of mortgage of that decree instituted this suit against two defendants. The defendant No. 1 was the plaintiff in the earlier suit who had mortgaged to the plaintiff the decree to be passed in that suit and the defendant No. 2 was a person who claimed to be a transferee of the same decree under a conveyance subsequently executed in his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ree by an assignment in writing, within the meaning of Order XXI, rule 16. Learned counsel for the respondent company then contends that even if the respondent company did not, by force of the prior agreement in writing read in the light of the equitable principle alluded to above or of the provisions of the Transfer of Property Act, become the transferees of the decree by an assignment in writing, they, nevertheless, became the transferees of the decree by operation of law within the meaning of Order XXI, rule 16. That phrase has been considered by the different High Courts in numerous cases but the interpretations put upon it are not at all uniform and it is difficult to reconcile all of them. In this judgment in the present case the executing court expressed the view that the phrase could only mean that the rights had been transferred on account of devolution of interest on death, etc . In delivering the judgment in the Letters Patent Appeal, Chagla, C.J., said:- The operation of law contemplated by Order XXI, rule-16 is not any equitable principle but operation by devolution as in the case of death or insolvency . The learned Chief Justice does not give any reason ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nded, or by operation of law, from the original decree-holder. No incident bad occurred, on which the law could operate, to transfer any estate from his mother to him. There had been no death; there bad been no devolution; there had been no succession. His mother retained what right she had; that right was not transferred to him; if he had a right, it was derived from his father; it appears to their Lordships, therefore, that be is not a transferee of a decree within the terms of this section . The above observations seem to put upon the phrase by operation of law an interpretation which, in the language of Chakravartti, J., in his judgment in Sailendra Kumar v. Bank of Calcutta(1) suggests that it would apply only in cases where certain events, not connected with any act on the part of anybody towards making a transfer, happen and the law, operating on those events, brings about a transfer . Some of the decisions of certain High Courts to be presently cited seem to assume that their Lordships of the Privy Council were out to give an exhaustive enumeration of the cases of transfer of property by operation of law but I find myself in agreement with Chakravartti, J., that there is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which have been codified. Court sale of property in execution of a decree vests the right, title and interest of the judgment-debtor in that property in the auction-purchaser thereby effecting a transfer by operation of the law embodied in the Code of Civil Procedure. Likewise, statutes in some cases provide for the forfeiture of property, e.g. property in relation to which an offence has been committed, namely, illicit liquor or opium, etc., and thereby effect a transfer of such property from the delinquent owner to the State. It is neither necessary nor profitable to try and enumerate exhaustively the instances of transfer by operation of law. Suffice it to say that there is DO warrant for confining transfers by operation of law to transfers by operation of statutory laws. When a Hindu or a Mohammaden dies intestate and his heirs succeed to his estate there is a transfer not by any statute but by the operation of their respective personal law. In order to constitute a transfer of property by operation of law all that is necessary is that there must be a passing of one person's rights in property to another person by the force of some law, statutory or otherwise. Refer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ases by deducing two propositions: (1) that the words by operation of law cannot be invoked so as to make an assignment operative to transfer the decree and the right under it which would upon the true construction of its terms, otherwise, be inoperative in that regard; and (2) that although in certain cases principles of equity may be relied on, e.g., in the case of a transfer by trustees and a beneficiary, such principles cannot be considered as rendering a transfer valid by operation of law . It is difficult to appreciate the implication of the first proposition. When on a true construction of the deed it actually operates to transfer a decree then in existence, no equitable principle need be invoked, for in that case the transfer is by the deed itself and as such is by an assignment in writing. It is only when the deed does not effectively transfer the decree because, for instance, the decree is not then in existence, but constitutes only an agreement to transfer the decree after it is passed that the invocation of the equitable principle becomes necessary and it is in those circumstances that equity fastens and operates upon the decree when it is passed and effects a tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... um will not be a transferee by operation of law. If an involuntary execution sale is not a transaction inter vivos why should an auction sale held in a partnership action in the teeth of opposition of the parties be a transaction inter vivos? The learned Judges concluded that as no particular form of assignment was prescribed for transfer, the order of the Court might be treated as an assignment in writing of the decree. I find it much easier to hold that there was in that case a transfer by operation of law than that the Court acted as the agent of the partners and the order of the Court was the assignment in writing. The law authorised the Court in a partnership action to order the sale of the partnership assets and consequently the sale passed the interest of all the partners other than the purchasing partner in the decree solely to (1) A.I.R. 1936 Mad. 548. 179 the latter. I do not see why a transfer thus brought about should not, like a transfer effected by a Court sale in execution, be regarded as a transfer by operation of law. Further, as,I have already said, there is no valid reason for confining transfer by operation of law to succession and bankruptcy or the like. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssession of the putni as he was entitled to do under the above section. He then filed a suit and obtained a decree for arrears of rent due to the Patnidar from another Darpatnidar. Subsequently he relinquished possession in favour of the Patnidar by giving a notice to the Patnidar. The question was whether the Patnidar, after he got back the possession of the putni, could be regarded as the assignee of the decree which had been obtained by the Varpatnidar against another Darpatnidar. It was held that in view of the provisions of section 13(4) the Patnidar on getting back possession of the putni became the transferee of the decree by operation of law. It was also held that the notice given by the Darpatnidar to the Patnidar could also be construed as an assignment in writing, The result of the authorities appears to me to be that if by reason of any provision of law, statutory or otherwise, interest in property passes from one person to another there is a transfer of the property by operation of law. There is no reason that I can see why transfers by operation of law should be regarded as confined to the three cases referred to by the Privy Council in Abedoonissa's case. If, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on precludes a person, who claims to be entitled to the benefit of a decree under the decree-holder but does not answer the description of being the transferee of that decree by assignment in writing or by operation of law, from making an application which the person from whom he claims could have made. It is said: what, then, is meant by the words save as otherwise provided by this Code ? The answer is that those words are not meaningless but have effect in some cases. Take, by way of an illustration, the second proviso to Order XXI, rule 16 which provides that where a decree for payment of money against two or more persons has been transferred to one of them it shall not be executed against the others. This is a provision which forbids one of the judgment-debtors to whom alone the decree for payment of money has been transferred from making an application for execution and, therefore, he cannot apply under section 146 as a person claiming under the decree-holder. As the respondent company do not fall within Order XXI, rule 16 because the document did not cover the decree to be passed in future in the then pending suit that rule cannot be a bar to the respondent company making an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the law, the position of the transferors, vis-a-vis the respondent company, was nothing more than that of benamidars for the respondent company and when the decree was passed for the recovery of that debt it was the respondent company who were the real owners of the decree. As between the respondent company and the transferors the former may well claim a declaration of their title. Here there is no question of transfer of the decree by the transferors to the respondent company by assignment of the decree in writing or by operation of law and the respondent company cannot apply for execution of the decree under Order XXI, rule 16. But the respondent company are, nonetheless, the real owners of the decree because it is passed in relation to and for the recovery of the debt which undoubtedly they acquired by transfer by the document under consideration. The respondent company were after the transfer, the owners of the debt which was the subject matter of the suit and the legal incidents thereof and consequently were the real owners of the decree. The respondent company derived their title to the debt by transfer from the transferors and claimed the same under the latter. When the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision in the case of Radha Nath Das v. Produmna Kumar Sarkar(1) and Krishna Govind Patil v. Moolchand Keshavchand Gujar(1) will show but this objection was not taken before the executing Court which could then have returned the application, nor was any objection taken by the appellant at any later stage of the proceedings. Further, it appears that the respondent company actually presented another tabular statement for execution specifying the mode in which the assistance of the Court was required. In these circumstances, it is not open to the appellant to contend that the application is not maintainable. The result, therefore, is that this appeal must be dismissed with costs. BHAGWATI J.-I agree that the appeal be dismissed with costs. I would however like to record my own reasons for doing so. Habib Sons, a partnership firm which carried on business as merchants and Pukka Adatias in bullion and cotton in Bombay filed a suit against the Appellant in the City Civil Court, Bombay being Summary Suit No. 233 of 1948, to recover a sum of ₹ 7,113-7-0 with interest and costs. During the pendency of the suit an agreement was arrived at between Habib Sons and the Responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecree passed in favour of Habib Sons and by them transferred to the Respondents, the assignees of the decree should not be executed by the said transferees against the Appellant. The Appellant showed cause and contended (1) that the deed of assignment in favour of the Respondents was not executed by Habib Sons and (2) that the assignee of the subject-matter of the suit and not of the decree itself was not entitled to apply for leave under Order XXI, Rule 16 of the Code of Civil Procedure. The Chamber Summons was adjourned to Court in order to take evidence whether the document in question was executed by Habib Sons or not. Evidence was led at the hearing and the Court held the document duly executed by the two partners of Habib Sons and as such duly proved. On the question of law the Court followed the decisions in Purmananddas Jiwandas v. Vallabdas Wallji (1) and Chimanlal Hargovinddas v. Gulamnabi(2) and held that the Respondents were entitled to execute the decree under Order XXI, rule 16 of the Code of Civil Procedure. An appeal was taken by the Appellant to the High Court against this decision of the City Civil Court. The appeal came for hearing before Dixit, J. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll be given to the transferor and the judgment-debtor, and the decree shall not be executed until the Court has heard their objections (if any) to its execution The transfer contemplated under this rule is either by assignment in writing or by operation of law. It was not contended by the Appellant at any stage of the proceedings that there was in this case a transfer by operation of law or that the agreement dated the 7th February 1949 was not an assignment of all the rights which Habib Sons had in connection with the Indian business. The question therefore that falls to be considered is whether the deed of assignment dated the 7th February 1949 operates as a transfer of the decree by assignment in writing within the meaning of Order XXI, rule 16 of the Code of Civil Procedure. A strict and narrow construction has been put upon the words where a decree is transferred by assignment in writing by the High Court of Madras in Basroovittil Bhandari v. Ramchandra Kamthi(1) and the decisions following it, particularly Kangati Mahanandi Reddi v. Panikalapati Venkatappa Another(2) and by the High Court of Calcutta in Mathurapore Zamindary Co. Ltd. v. Bhasaram Mandal(1) which is fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of Abedoonissa Khatoon v. Ameeroonissa Khatoon Their Lordships have further to observe, that they agree with the Chief Justice in the view which he expressed,-that this was not a section intended to apply to cases where a serious contest arose with respect to the rights of persons to an equitable interest in a decree . Rankin, C.J. laid stress upon this aspect of the question and delivered a similar opinion in Prabhashinee Debi v. Rasiklal Banerji(1) at page 299:- There seem to be two possible views of the rule. One view would be to say that there must be a decree in existence and a transfer in writing of that decree. That is the strict view-a view which the courts in India have taken. The only other possible view would be to say that, while other cases are within the rule-such as cases where a person claims to be entitled in equity under an agreement to the benefit of the decree-it is optional with the courts to give effect to the rule according as the case is a clear one or one which requires investigation of complicated facts or difficult questions of law unsuited for discussion on a mere execution application. In that view, if it were understood that the court ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecree to be passed in the future therefore there could be no assignment of the decree unless and until the decree was passed and the agreement to assign fastened on the decree and thus became a complete equitable assignment. The decree not being in existence at the date of the transfer cannot be said to have been transferred by the assignment in writing and the matter resting merely in a contract to be performed in the future which may be specifically enforced as soon as the decree was passed there would be no transfer automatically in favour of the transferee of the decree when passed. It would require a further act on the part of the transferor to completely effectuate the transfer and if he did not do so the only remedy of the transferee would-be to sue for specific performance of the contract to transfer. There would therefore be no legal transfer or assignment of the decree to be passed in future by virtue of the assignment in writing executed before the decree came into existence and the only way in which the transferee could claim that the decree was transferred to him by assignment in writing would be by the operation of the equitable principle above enunciated and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ebtor on the other, there is no warrant for reading the words where a decree....................... is transferred by assignment in writing in the strict and narrow sense,, in which they have been read by the High Court of Madras in Basroovittil Bhandari v. Ramchandra Kamthi(1) and the High Court of Calcutta in Mathurapore Zamindary Co. Ltd. v. Bhasaram Mandal(2) and Prabashinee Debi v. Rasiklal Banerji(3). It is significant to observe that the High Court of Calcutta in Purna Chandra Bhowmik v. Barna Kumari Debi(1) applied this equitable principle and held that the plaintiff in whose favour the defendant had executed a mortgage bond assigning by way of security the decree that would be passed in a suit instituted by him against a third party for recovery of money due on unpaid bills for work done was entitled to a declaration that be was the assignee of the decree passed in favour of the defendants and was as such entitled to realise the decretal debt either amicably or by execution. If the plaintiff was thus declared to be the assignee of the decree subsequently passed in favour of the defendant and entitled to realise the decretal amount by execution he could apply for executio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... another(3). Where however the property which is transferred is an actionable claim within the meaning of its definition in section 3 of the Transfer of Property Act the consequences of such transfer would be different. An actionable claim means a claim to any debt, or to any beneficial interest in moveable property not in the possession, either actual or constructive, of the claimant, which the Civil Courts recognize as affording grounds -for relief, and a transfer of an actionable claim when effected by an instrument in writing signed by the transferor is under section 130 of the Act complete and effectual upon the execution of such instrument, and thereupon all the rights and remedies of the transferor, whether by way of damages or otherwise, vest in the transferee, whether such notice of the transfer as is therein provided be given to the debtor or not. If the book debt or the property which is an actionable claim is thus transferred by an assignment in writing all the rights and remedies of the transferor in respect thereof including the right to prosecute the claim to judgment in a Court of law either in a pending litigation or by institution of a suit for recovery of the sam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. The transferee of the actionable claim thus could step into the shoes of the transferor and claim to be the transferee of the decree by virtue of the assignment in writing executed by the transferor in his favour and could therefore claim to execute the decree as transferee under Order XXI, rule 16 of the, Code of Civil Procedure. This aspect could not be considered by the High Court of Bombay in Purmananddas Jivandas v. Vallabdas Wallji(1) because the assignment there was executed on the 11th May, 1870, i.e. before the enactment of the Transfer of Property Act in 1882. The Court therefore applied the equitable principles and came to the conclusion that the equitable assignment which was completed on the passing of the decree was covered by the old section 232 of the Code of Civil Procedure. It was also not considered by the Full Bench of the High Court of Bombay in Chimanlal Hargovinddas V. Gulamnabi (2) nor by Dixit, J. or by the Division Bench in the present case. The High Court of Patna in Thakuri Gope and Others v. Mokhtar Ahmad Another(3), went very near it when it observed that all that was transferred was an actionable claim, but did not work out the consequences t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Code of Civil Procedure did not prohibit such execution proceedings at the instance of the Respondents and for this purpose relied upon the observations of the learned Judges of the High Court of Madras in Kangati Mahanandi Reddi v. Panikalapati Venkatappa another(1) at page 23:- We are unable to hold that merely because rule 16 has been interpreted as applying only to decrees in existence at the time of the transfer, it prohibits an application by a transferee who obtained the transfer of a decree, a transfer which is legally valid and is embodied in a written deed (as rule 16 requires) before the decree was actually passed. To permit execution by such a transferee, in our opinion, in no way violates the principles which are embodied in rule 16 or in Order XXI generally. The appellant here is the true owner of the decree, and he has his written title 'deed, and that is all that the law requires . It was however urged on behalf of the Appellant that section 146 did not apply because Order XXI, rule 16 was a specific -provision in the Code of Civil Procedure which applied when a person other than a decree-holder wanted to execute the decree and if the Respondents could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder XXI, rule 11(2) (j) prescribes that particulars in regard to the mode in which the assistance of the Court was required should be set out there in. The respondents had in -their application for execution filed before the City Civil Court not mentioned any of these particulars but had only stated that the Court should declare them the assignees of the decree as the decretal debt along with other debts were transferred by Habib Sons to them by the deed of assignment dated the 7th February 1949 which was confirmed by the Custodian of Evacuee Property, Bombay and should order them to be substituted for Habib Sons. This was no compliance with the provisions of Order XXI, rule 11(2) (j) and therefore there was no proper application for execution before the Court and the same was liable to be dismissed. Reliance was placed in support of this contention on a decision of the High Court of Calcutta in Radha Nath Das v. Produmna Kumar Sarkar(1), where it was held dissenting from a decision of the High Court of Bombay in Baijnath Ramchander v. Binjraj Joowarmal Batia Co. (2) that under Order XXI, rule 16 of the Code of Civil Procedure the ,assignee of a decree cannot make two applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. This defect however was not such as to preclude the Respondents from obtaining the necessary relief. The application which was filed by them in the City Civil ' Court was headed application for execution under Order XXI, rule 11 of the Code of Civil Procedure and the only defect was in the specification of the mode in which the assistance of the Court was required. The particulars which were required to be filled in column J. were not in accordance with the requirements of Order XXI, rule 11(2) (j) and should have specified one of the modes therein prescribed and certainly a declaration that the respondents were the assignees of the decree and the order for their substitution as the plaintiffs was certainly not one of the prescribed modes which were required to be specified in that column. The practice which prevailed in the High Court of Bombay as recognised in Baijnath Ramchander v. Binjraj Joowarmal Batia Co(1) and also in Bhagwant Balajirao and others v. Rajaram Sajnaji others(3) appears to have been the only justification for making the application in the manner which the respondents did. That defect however according to the very same decision in Bhagwant Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent claimed to execute the decree was treated as a deed of transfer in the courts below and not merely as an agreement to transfer. By this document there was a transfer of all the book and other debts due to Habib Sons in connection with the Indian business and the full benefit of all securities for the debts. The document, however, neither in terms, nor by any reasonable interpretation of its contents purported to transfer any decree which Habib Sons may obtain in the future. It seems to me, therefore, that the respondent cannot claim to be a transferee of the decree, which was subsequently obtained by Habib Sons, by an assignment in writing within the meaning of Order XXI, rule 16 of the Code of Civil Procedure. Order XXI of the Code of Civil Procedure relates to execution of decrees and orders. Rule 1 of that Order relates to payments under a decree which has been passed. Rules 4 to 9 relate to the transfer of an existing decree for execution. The normal rule is that a decree can be executed only by the person in whose name it stands and rule 10 enables him to do so, while rule 16 of Order XXI, enables the transferee of the decree to execute it in the same manner and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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